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China approves retaliatory tariffs worth $50 billion on US imported goods

Economic security, worldwide, is therefore much less certain as Trump pursues this path

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Earlier this year, Trump announced tariffs against Chinese goods, which prompted retaliatory tariffs from Beijing.

Trump followed up China’s retaliation with even further punitive measures, which China then responded to before negotiations in Washington managed to cool the tensions down somewhat.

However, within a very brief time, Washington came back out with its tariffs against China, particularly relative to Chinese metals, in a similar fashion as was also being applied to other US trade partners with the pretext of reducing trade deficits which were perceived by the Trump administration as a threat to American national security, sparking outrage from US European, Canadian, Japanese, Korean, and Mexican trade partners, among others.

With the Trump administration’s renege on the trade wars truce which had just been hashed out, China is now responding with tariffs of its own worth $50 billion.

The South China Morning Post reports:

China’s Finance Ministry has imposed an additional 25 per cent tariff on some US$50 billion of US imports and said the US has invalidated recent high-level talks aimed at averting a trade war

China has hit back at US President Donald Trump after he slapped punitive tariffs on Chinese goods on Friday, announcing that it would place its own additional 25 per cent tariffs on 659 US imports worth a total of US$50 billion.

Tariffs on about US$34 billion of those products will start on July 6, and be applied to soybeans, corn, wheat, rice, sorghum, beef, pork, poultry, fish, dairy products, nuts and vegetables, autos and aquatic products, China’s finance and commerce ministries said.

In addition, China said Trump’s move invalidated recent high-level negotiations aimed at averting a trade war.

“All the previous agreements reached through talks will become invalid,” the Ministry of Commerce said in the statement. “China doesn’t want to engage in a trade war, but in face of the shortsighted acts from the US side … China is forced to take strong and forceful measures to hit back,” it said.

The effective date of the tariffs on the remaining US$16 billion of American goods will be announced later, the commerce ministry said. Among those items are crude oil, natural gas, coal and some refined oil products.

The list of 659 US goods was longer than a preliminary list of 106 products published by the Chinese commerce ministry in April, although their remained unchanged at US$50 billion. Aircraft, which were previously included, were not on the revised list.

China’s response came on Friday afternoon, hours after Trump confirmed his plan to slap punitive tariffs on Chinese products that “contain industrially significant technologies”. The move is part of his effort to close a bilateral trade gap and force Beijing to change the way it acquires US technology.

The US will put a 25 per cent tariff on US$50 billion worth of annual imports from China, including “goods related to China’s Made in China 2025 strategic plan to dominate the emerging high-technology industries that will drive future economic growth for China, but hurt economic growth for the United States and many other countries”, Trump said in an official White House statement.

Made in China 2025 refers to Beijing’s industrial policy of subsidising domestic companies developing strategic advanced technologies, including robotics and artificial intelligence.

China has “long been engaging in several unfair practices related to the acquisition of American intellectual property and technology. These practices … harm our economic and national security and deepen our already massive trade imbalance with China,” Trump said.

US stocks retreated on Friday amid the countries’ competing announcements, with major indices in the red the entire session, although they closed above their session lows.

The Dow Jones Industrial Average dropped 0.3 per cent to end the week at 25,090.48. The broad-based S&P 500 slipped 0.1 per cent to close at 2,779.42, and the tech-rich Nasdaq Composite index lost 0.2 per cent to 7,746.38, retreating from Thursday’s record.

Large multinationals active in China were among the worst performers in the Dow, with Caterpillar losing 2 per cent and Boeing and General Electric both falling more than 1 per cent.

Petroleum-linked shares also tumbled on a pullback in oil prices due in part to the trade discord. Chevron fell 2 per cent, Halliburton 2.4 per cent and ConocoPhillips 4.1 per cent.

Trump’s announcement on Friday follows up on pledges he has made since he campaigned in 2016 to address the long-running US trade deficit with China.

That gap rose to a record US$375 billion last year and amounted to US$119 billion in the first four months of 2018, according to US government data.

Trump vowed to fight any retaliation by China – be it tariffs, non-tariff barriers or “punitive actions against American exporters or American companies operating in China” – with additional tariffs, raising the possibility of an all-out trade war.

“The Trump administration is now committed to tariffs on US$50 billion of imports from China, and China has signalled that it will retaliate on US$50 billion of US exports,” David Dollar, a China expert at the Brookings Institution, a Washington-based think tank, told the South China Morning Post.

“The question that no one can answer right now is whether Trump will then escalate into a full-blown trade war. It is hard to see either side backing down in the near future.”

Trump has bipartisan support among lawmakers to take measures to curtail acquisition of US technology by Chinese interests, as many of them see such transfers as strengthening China’s military capabilities.

Some technology sought by Chinese investors has military applications, the US Defence Department warned in a report published last year.

The Trump administration’s tactics are bumping up against Beijing’s overarching economic ambitions.

“One of the things that [Chinese President] Xi Jinping is focused on is the transformation [of his country] from the manufacturing centre of the world to the innovation centre of the world,” Elizabeth Economy, director for Asia Studies at the Council on Foreign Relations, said in a discussion at the Wharton Global Forum on Thursday.

“They’re using subsidies to encourage Chinese firms and give them an advantage,” she said. Moreover, “a number of restrictions or regulations … make it difficult for foreign companies to compete” in China, Economy said.

US Trade Representative Robert Lighthizer has led investigations into the trade and investment practices Trump has targeted.

A nearly 200-page report from the trade representative’s office published in March alleges, among other things, that these policies “deprive US companies of the ability to set market-based terms in licensing and other technology-related negotiations with Chinese companies and undermine US companies’ control over their technology in China”.

Still, some in the US corporate sector are condemning Trump’s decision to address trade imbalances and investment restrictions through unilateral tariff measures.

“We urge both governments to sit down and negotiate a solution to these important issues. American companies want solutions, not sanctions,” US-China Business Council (USCBC) President John Frisbie said in a statement.

“Tariffs will not solve these problems, but will harm American economic interests and jobs. Rather than inflicting damage on ourselves, we should be seeking ways to address the problems with China,” he said.

“Pursuing pragmatic outcomes in coordination with other like-minded trading partners is a better approach than going it alone and exposing American workers, farmers and companies to retaliation.”

Some analysts played down the urgency of the latest phase in US-China trade tensions, pointing out that both sides have returned to dialogue despite regular rhetorical flare-ups.

“Clearly there’s a lot of ups and downs, and both sides seem to be OK with that,” Bart Oosterveld, director of the Washington-based Atlantic Council’s Global Business and Economics Programme, told the Post.

“They do seem to get past pretty rough statements made against each other and then get back to the table again.”

Oosterveld said he expected the parties would strike an agreement that could halt the confrontation “probably at some point this year”.

Allowing the trade battle to continue would be “very costly” over time for “both economies and for consumers in both economies”, the director said. “In the meantime, we may see some further escalations.”

Derek Scissors, a China expert at the American Enterprise Institute, another Washington-based think tank, agreed.

“This is far too small a step to lead to a serious trade conflict,” Scissors told the Post.

“I believe the initial tariffs will go into effect July 6. However, the second set of tariffs allows time for negotiations, which could lead to the initial tariffs being lifted after only a few months.”

The White House announcement on Friday did not say when the US tariffs would take effect.

Trump is pushing forward on his agenda to even things out with America’s trade partners, regardless of the consequences, under the assumption that he can just throw America’s economic weight around in an aggressive manner while expecting that respect for America alone will serve as enough of a deterrent against meaningful consequences adversely impacting America’s political and economic hegemony, as well as its own domestic well being.

Not only is China broadening its trade horizons with an ever growing list of markets, but so too is Europe.

Mexico, too, is looking for other suppliers from which to purchase certain agricultural goods in a bid to decrease the detrimental effect of an escalating trade conflict with America.

Economic security, worldwide, is therefore much less certain as Trump pursues this path, and the trade arrangements that have brought America, China, Europe, and North America to their respective places in the global economy are changing in very radical ways, often in ways that don’t respect America’s position. Meaning, therefore, that Trump’s policies, rather than putting America first, are, in effect, putting America last.

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Rastislav Veľká Morava
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Rastislav Veľká Morava

It is time to END Globalism, US Led, China Led, EU Led, or any other.

JNDillard
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JNDillard

What is to keep China from simply shifting its trade to other, non US markets, as Russia has done and Iran is doing with the US and EU?

ghartwell
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Sounds like a set up to increase cooperation, trade and development in other than American countries to their benefit like sanctions benefited the Russian economy. Punish other and punish yourself. Break cooperation with the world and the world leaves you behind.

Daisy Adler
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Daisy Adler

Latest News:
China “threatened to impose tariffs on US energy products in response to $50 billion in tariffs imposed by US President Donald Trump. Such tariffs would inhibit Chinese refiners from buying US crude imports, potentially crashing US energy markets and hitting the fossil fuel industry where it hurts the most…
China imports approximately 363,000 barrels of US crude oil daily. The country also imports about 200,000 barrels a day of other petroleum products” https://sputniknews.com/world/201806171065497038-china-crude-oil-tariff-US-suprise/

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Foreign Banks Are Embracing Russia’s Alternative To SWIFT, Moscow Says

Given its status as a major energy exporter, Russia has leverage that could help attract partners to its new SWIFT alternative.

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Via Zerohedge


On Friday, one day after Russia and China pledged to reduce their reliance on the dollar by increasing the amount of bilateral trade conducted in rubles and yuan (a goal toward which much progress has already been made over the past three years), Russia’s Central Bank provided the latest update on Moscow’s alternative to US-dominated international payments network SWIFT.

Moscow started working on the project back in 2014, when international sanctions over Russia’s annexation of Crimea inspired fears that the country’s largest banks would soon be cut off from SWIFT which, though it’s based in Belgium and claims to be politically neutral, is effectively controlled by the US Treasury.

Today, the Russian alternative, known as the System for Transfer of Financial Messages, has attracted a modest amount of support within the Russian business community, with 416 Russian companies having joined as of September, including the Russian Federal Treasury and large state corporations likeGazprom Neft and Rosneft.

And now, eight months after a senior Russian official advised that “our banks are ready to turn off SWIFT,” it appears the system has reached another milestone in its development: It’s ready to take on international partners in the quest to de-dollarize and end the US’s leverage over the international financial system. A Russian official advised that non-residents will begin joining the system “this year,” according to RT.

“Non-residents will start connecting to us this year. People are already turning to us,”said First Deputy Governor of the Central Bank of Russia Olga Skorobogatova. Earlier, the official said that by using the alternative payment system foreign firms would be able to do business with sanctioned Russian companies.

Turkey, China, India and others are among the countries that might be interested in a SWIFT alternative, as Russian President Vladimir Putin pointed out in a speech earlier this month, the US’s willingness to blithely sanction countries from Iran to Venezuela and beyond will eventually rebound on the US economy by undermining the dollar’s status as the world’s reserve currency.

To be sure, the Russians aren’t the only ones building a SWIFT alternative to help avoid US sanctions. Russia and China, along with the European Union are launching an interbank payments network known as the Special Purpose Vehicle to help companies pursue “legitimate business with Iran” in defiance of US sanctions.

Given its status as a major energy exporter, Russia has leverage that could help attract partners to its new SWIFT alternative. For one, much of Europe is dependent on Russian natural gas and oil.

And as Russian trade with other US rivals increases, Moscow’s payments network will look increasingly attractive,particularly if buyers of Russian crude have no other alternatives to pay for their goods.

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US leaving INF will put nuclear non-proliferation at risk & may lead to ‘complete chaos’

The US is pulling out of a nuclear missile pact with Russia. The Intermediate-Range Nuclear Forces Treaty requires both countries to eliminate their short and medium-range atomic missiles.

The Duran

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Via RT


If the US ditches the Intermediate-Range Nuclear Forces Treaty (INF), it could collapse the entire nuclear non-proliferation system, and bring nuclear war even closer, Russian officials warn.

By ending the INF, Washington risks creating a domino effect which could endanger other landmark deals like the Strategic Arms Reduction Treaty (START) and collapse the existing non-proliferation mechanism as we know it, senior lawmaker Konstantin Kosachev said on Sunday.

The current iteration of the START treaty, which limits the deployment of all types of nuclear weapons, is due to expire in 2021. Kosachev, who chairs the Parliament’s Upper House Foreign Affairs Committee, warned that such an outcome pits mankind against “complete chaos in terms of nuclear weapons.”

“Now the US Western allies face a choice: either embarking on the same path, possibly leading to new war, or siding with common sense, at least for the sake of their self-preservation instinct.”

His remarks came after US President Donald Trump announced his intentions to “terminate” the INF, citing alleged violations of the deal by Russia.

Moscow has repeatedly denied undermining the treaty, pointing out that Trump has failed to produce any evidence of violations. Moreover, Russian officials insist that the deployment of US-made Mk 41 ground-based universal launching systems in Europe actually violates the agreement since the launchers are capable of firing mid-range cruise missiles.

Leonid Slutsky, who leads the Foreign Affairs Committee in parliament’s lower chamber, argued that Trump’s words are akin to placing “a huge mine under the whole disarmament process on the planet.”

The INF Treaty was signed in 1987 by then-President Ronald Reagan and Soviet leader Mikhail Gorbachev. The deal effectively bans the parties from having and developing short- and mid-range missiles of all types. According to the provisions, the US was obliged to destroy Pershing I and II launcher systems and BGM-109G Gryphon ground-launched cruise missiles. Moscow, meanwhile, pledged to remove the SS-20 and several other types of missiles from its nuclear arsenal.

Pershing missiles stationed in the US Army arsenal. © Hulton Archive / Getty Images ©

By scrapping the historic accord, Washington is trying to fulfill its “dream of a unipolar world,” a source within the Russian Foreign Ministry said.

“This decision fits into the US policy of ditching the international agreements which impose equal obligations on it and its partners, and render the ‘exceptionalism’ concept vulnerable.”

Deputy Foreign Minister Sergey Ryabkov denounced Trump’s threats as “blackmail” and said that Washington wants to dismantle the INF because it views the deal as a “problem” on its course for “total domination” in the military sphere.

The issue of nuclear arms treaties is too vital for national and global security to rush into hastily-made “emotional” decisions, the official explained. Russia is expecting to hear more on the US’ plans from Trump’s top security adviser, John Bolton, who is set to hold talks in Moscow tomorrow.

President Trump has been open about unilaterally pulling the US out of various international agreements if he deems them to be damaging to national interests. Earlier this year, Washington withdrew from the Joint Comprehensive Plan of Action (JCPOA) on the Iranian nuclear program. All other signatories to the landmark agreement, including Russia, China, and the EU, decided to stick to the deal, while blasting Trump for leaving.

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Converting Khashoggi into Cash

After two weeks of denying any connection to Khashoggi’s disappearance, Riyadh has admitted that he was killed by Saudi operatives but it wasn’t really on purpose.

Jim Jatras

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Authored by James George Jatras via The Strategic Culture Foundation:


The hazard of writing about the Saudis’ absurd gyrations as they seek to avoid blame for the murder of the late, not notably great journalist and Muslim Brotherhood activist Jamal Khashoggi is that by the time a sentence is finished, the landscape may have changed again.

As though right on cue, the narrative has just taken another sharp turn.

After two weeks of denying any connection to Khashoggi’s disappearance, Riyadh has ‘fessed up (sorta) and admitted that he was killed by Saudi operatives but it wasn’t really on purpose:

Y’see, it was kinda’f an ‘accident.’

Oops…

Y’see the guys were arguing, and … uh … a fistfight broke out.

Yeah, that’s it … a ‘fistfight.’

And before you know it poor Jamal had gone all to pieces.

Y’see?

Must’ve been a helluva fistfight.

The figurative digital ink wasn’t even dry on that whopper before American politicos in both parties were calling it out:

  • “To say that I am skeptical of the new Saudi narrative about Mr. Khashoggi is an understatement,” tweeted Republican Sen. Lindsey Graham of South Carolina. “First we were told Mr. Khashoggi supposedly left the consulate and there was blanket denial of any Saudi involvement. Now, a fight breaks out and he’s killed in the consulate, all without knowledge of Crown Prince. It’s hard to find this latest ‘explanation‘ as credible.”
  • California Rep. Adam Schiff, the ranking Democrat on the House Intelligence Committee, said in a statement that the new Saudi explanation is “not credible.” “If Khashoggi was fighting inside the Saudi consulate in Istanbul, he was fighting for his life with people sent to capture or kill him,” Schiff said. “The kingdom and all involved in this brutal murder must be held accountable, and if the Trump administration will not take the lead, Congress must.”

Turkish President Recep Tayyip Erdogan must think he’s already died and gone to his eternal recreation in the amorous embraces of the dark-eyed houris. The acid test for the viability of Riyadh’s newest transparent lie is whether the Turks actually have, as they claim, live recordings of Khashoggi’s interrogation, torture, murder, and dismemberment (not necessarily in that order) – and if they do, when Erdogan decides it’s the right time to release them.

Erdogan has got the Saudis over a barrel and he’ll squeeze everything he can out of them.

From the beginning, the Khashoggi story wasn’t really about the fate of one man. The Saudis have been getting away with bloody murder, literally, for years. They’re daily slaughtering the civilian population of Yemen with American and British help, with barely a ho-hum from the sensitive consciences always ready to invoke the so-called “responsibility to protect” Muslims in Bosnia, Kosovo, Libya, Syria, Xinjiang, Rakhine, and so forth.

Where’s the responsibility not to help a crazed bunch of Wahhabist head-choppers kill people?

But now, just one guy meets a grisly end and suddenly it’s the most important homicide since the Lindbergh baby.

What gives?

Is it because Khashoggi was part of the MSM aristocracy, on account of his relationship with the Washington Post?

Was it because of his other, darker, connections? As related by Moon of Alabama: “Khashoggi was a rather shady guy. A ‘journalist’ who was also an operator for Saudi and U.S. intelligence services. He was an early recruit of the Muslim Brotherhood.” This relationship, writes MoA, touches on the interests of pretty much everyone in the region:

“The Ottoman empire ruled over much of the Arab world. The neo-Ottoman wannabe-Sultan Recep Tayyip Erdogan would like to regain that historic position for Turkey. His main competition in this are the al-Sauds. They have much more money and are strategically aligned with Israel and the United States, while Turkey under Erdogan is more or less isolated. The religious-political element of the competition is represented on one side by the Muslim Brotherhood, ‘democratic’ Islamists to which Erdogan belongs, and the Wahhabi absolutists on the other side.”

With the noose tightening around Saudi Crown Prince Mohammad bin Salman (MbS), the risible fistfight cock-and-bull story is likely to be the best they can come up with. US President Donald Trump’s having offered his “rogue killers” opening suggests he’s willing to play along. Nobody will really be fooled, but MbS will hope he can persuade important people to pretend they are fooled.

That will mean spreading around a lot of cash. The new alchemy of converting Khashoggi dead into financial gain for the living is just one part of an obvious scheme to pull off what Libya’s Muammar Kaddafi managed after the 1988 Lockerbie bombing: offer up some underlings as the fall guys and let the top man evade responsibility. (KARMA ALERT: That didn’t do Kaddafi any good in the long run.)

In the Saudi case the Lockerbie dodge will be harder, as there are already pictures of men at the Istanbul Consulate General identified as close associates of MbS. But they’ll give it the old madrasa try anyway since it’s all they’ve got.Firings and arrests have started and one suspect has already died in a suspicious automobile “accident.” Heads will roll!

Saving MbS’s skin and his succession to the throne of his doddering father may depend on how many of the usual recipients of Saudi – let’s be honest – bribery and influence peddling will find sufficient pecuniary reason to go along. Saudi Arabia’s unofficial motto with respect to the US establishment might as well be: “The green poultice heals all wounds.”

Anyway, that’s been their experience up to now, but it also in part reflects the same arrogance that made MbS think he could continue to get away with anything. (It’s not shooting someone in the middle of Fifth Avenue, but it’s close.) Whether spreading cash around will continue to have the same salubrious effect it always has had in the past remains to be seen.

To be sure, Trump may succeed in shaking the Saudi date palm for additional billions for arms sales. That won’t necessarily turn around an image problem that may not have a remedy. But still, count on more cash going to high-price lobbying and image-control shops eager to make obscene money working for their obscene client. Some big American names are dropping are dropping Riyadh in a sudden fit of fastidiousness, but you can bet others will be eager to step into their Guccis, both in the US and in the United Kingdom. (It should never be forgotten how closely linked the US and UK establishments are in the Middle East, and to the Saudis in particular.)

It still might not work though. No matter how much expensive PR lipstick the spinmeisters put on this pig, that won’t make it kissable. It’s still a pig.

Others benefitting from hanging Khashoggi’s death around MbS’s neck are:

  • Qatar (after last year’s invasion scare, there’s no doubt a bit of Schadenfreude and (figurative) champagne corks popping in Doha over MbS’s discomfiture. As one source close to the ruling al-Thani family relates, “The Qataris are stunned speechless at Saudi incompetence!” You just can’t get good help these days).

Among the losers one must count Israel and especially Prime Minister Bibi Netanyahu. MbS, with his contrived image as the reformer, was the Sunni “beard” he needed to get the US to assemble an “Arab NATO” (as though one NATO weren’t bad enough!) and eliminate Iran for him. It remains to be seen how far that agenda has been set back.

Whether or not MbS survives or is removed – perhaps with extreme prejudice – there’s no doubt Saudi Arabia is the big loser. Question are being asked that should have been asked years ago. As Srdja Trifkovic comments in Chronicles magazine:

“The crown prince’s recklessness in ordering the murder of Khashoggi has demonstrated that he is just a standard despot, a Mafia don with oil presiding over an extended cleptocracy of inbred parasites. The KSA will not be reformed because it is structurally not capable of reform. The regime in Riyadh which stops being a playground of great wealth, protected by a large investment in theocratic excess, would not be ‘Saudi’ any longer. Saudia delenda est.”

The first Saudi state, the Emirate of Diriyah, went belly up in 1818, with the death of head of the house of al-Saud, Abdullah bin Saud – actually, literally with his head hung on a gate in Constantinople by Erdogan’s Ottoman predecessor, Sultan Mahmud II.

The second Saudi state, Emirate of Nejd, likewise folded in 1891.

It’s long past time this third and current abomination joined its antecedents on the ash heap of history.

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